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Quaker Fabric completes refinancing deal with BOA

11 Nov '06

2 min read

QUAKER FABRIC CORPORATION announced the closing of a refinancing transaction that will provide the Company with approximately $49.6 million of senior secured financing going forward.

This new financing arrangement includes both a $25.0 million senior secured revolving credit facility, with Bank of America (BOA), N.A. as Agent for the revolving credit lenders, and two (2) senior secured term loans in the aggregate amount of $24.6 million, with GB Merchant Partners, LLC as Agent for the term loan lenders.

The two term loans consist of a $12.5 million real estate loan and a $12.1 million equipment loan. Both term loans are secured by all of the Company's assets, with a first priority security interest in the Company's machinery and equipment and real estate.

Consistent with these new financing arrangements, the proceeds of the new term loans were used to repay, in full, all outstanding obligations under the term loan facility previously provided by Bank of America pursuant to the terms of Quaker's May 18, 2005 senior secured credit facility with the Bank, and the Company's Bank of America loan agreement was amended and restated to reflect the terms of the new revolving credit facility.

The Company's obligations to the revolving credit lenders are secured by all of the Company's assets, with a junior interest in Quaker's real estate and machinery and equipment. Both the Bank and GB transactions have maturity dates of May 17, 2010.

“We believe these new financing arrangements to be consistent with Quaker's strategic objectives and current operating and working capital needs – and we are pleased that we were able to bring our negotiations with Bank of America and GB Merchant Partners to a successful close.

We look forward to continuing the execution of our restructuring plan, the strengthening of Quaker's position of international leadership in our industry and restoring Quaker to profitability,” commented Larry A. Liebenow, Quaker's President and CEO.

Quaker Fabric Corporation is a leading manufacturer of woven upholstery fabrics for furniture markets in the United States and abroad, and the largest producer of Jacquard upholstery fabric in the world.

Quaker Fabric Corporation

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